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Food Ministry proposes 10 per cent import duty on sugar

16 Jul 2012 Evaluate

The Food Ministry in view of the surplus domestic production in the country has proposed imposing 10 per cent import duty on sugar. However, the government has not proposed higher duty so that the import option should be kept open to the traders in times of shortages. The Food Ministry has been said to have made recommendation to rationalise the duty structure on sugar in line with other farm commodities and has suggested the import duty on sugar to be capped at 10 per cent.

The sugar industry body ISMA, has said in its recent statement that the sugar production in the 2012-13 marketing year is expected to be higher than the demand at 25 million tonnes, annual domestic demand is of around 22 million tonnes. However, ISMA has lowered its all India sugar production estimate for 2012-13 by close to 4% as it expects output in biggest sugar-producing state Maharashtra to decline by about 16%.

ISMA estimates that out of Sugar production for 2012-13 season of 25 million tonnes, 78 lakh tonne is expected to be from UP, 76 lakh tonne from Maharashtra, 30 lakh tonne from Karnataka, 25 lakh tonne by Tamil Nadu, 10 lakh tonne each by Gujarat and Andhra Pradesh.

Sugar export was brought under the open general licence (OGL) in May, before that the government had allowed export of 2 million tonnes of sugar in view of higher production. Altogether, traders have got nod to export 7 lakh tones under the OGL so far.

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